Wednesday, December 2, 2015

Environment, Economy and Property Rights: All are Important

Do environmental concerns outweigh economic concerns? Granted, there are important environmental considerations to be dealt with in the years ahead. Just the same, environmental factors are more closely connected to economic circumstance, than some are willing to consider.

In response to the Paris Climate Change Conference, Lars Christensen also makes an important point about Ronald Coase. When property rights are clearly delineated, individuals ultimately gain the ability to tend to the ecosystem in sustainable ways. Much of the damage to the environment, results from those whose economic access has otherwise been limited in some capacity. When survival is at stake, some groups end up wasting resources in part because they may have been denied more productive means, for economic and social interaction.

Contrary to what some now reason, property rights in the 21st century need more careful definition and clarification. Too many aspects of knowledge use, as the most important resource (or property) of the 21st century, were previously "staked out" by special interests. In turn, organizational capacity is forced to compete through technology and "dictates" in service product duplication, with ever smaller degrees of compensated time value. As a result, many are beginning to reason that countless numbers of individuals will not even be needed for future economic activity.

But nothing could be further from the truth, and over time this rationale slowly becomes a recipe for disaster in the real economy. The fact that knowledge use rights were granted to special interests, makes everyone else less certain, whether time based knowledge can still be utilized for social and economic purposes in normal circumstance. This has generated extensive negative externalities, and created a services market void which is impossible to accurately gauge. As to the importance of property rights, Ben Southwood recently wrote:

And in a society where property rights are clear and extensive, most substantial externalities will be priced in.

Few other measures have been so psychologically detrimental, as unnecessary limits to knowledge use in today's world. Individuals need knowledge use in property rights context, so as to manage and create value for personal and entrepreneurial time use. Until now, asymmetric compensation for time value, has made it difficult for anyone to thrive in an entrepreneurial capacity, in terms of knowledge based services potential. This is why a marketplace for (finite) time value is also needed, alongside the marketplace which represents infinite resource capacity.

Physical aspects of property rights are important as well. Citizens need better delineation of property rights in terms of lifestyle context, to create the physical environments they seek. For instance: instead of nations trying to force one another to reduce their greenhouse emissions, they could be encouraging their own citizens to build new locales for walkable communities. There are many means to do so, which include new infrastructure options for energy use, transportation, and more.

Instead, at least in the U.S., there have been multiple accounts of local governments attempting to stop citizens from living "off grid". Why would nations discourage their own citizens, in their personal efforts for voluntary cutbacks in energy use? Even as world leaders considered a "bottom up" approach for environmental issues of late, the real bottom up approach is that of giving citizens a greater role in the knowledge use and environmental delineation they choose.